- The Washington Times - Sunday, March 14, 2004

There is no shortage of alternative ways to find tickets to sold-out sports events. There are ticket brokers, on-site scalpers, classified ads and, of course, EBay. The only question is how much a fan is willing to pay above face value.

Such open avarice bothered the founders of the Ticket Reserve. There must be a better way, the reasoning went, for an average fan to have a chance to attend events like the Super Bowl and Final Four that are dominated by corporate entities.

The result is an upstart Chicago-based company that combines a traditional ticket brokerage, the futures markets of the financial world, EBay, and perhaps a bit of fantasy sports leagues.

What the Ticket Reserve sells are “event certificates” to major sports events, each one good for a face-value ticket. Each certificate is sold on the Internet at ticketreserve.com for prices ranging from $10 to $200. But there’s a catch. Buyers must pick a team to put on that certificate, which then becomes valid only if that team reaches the big game. If your team gets knocked out of the tournament or playoffs early, the certificate loses all value.

In the case of the upcoming NCAA tournament, that makes top programs such as Duke, Stanford and Saint Joseph’s most popular among buyers. So the central concept of the Ticket Reserve is to limit the available certificates for each team — 12 for the semifinal round and 24 for the April5 title game — and then allow fans to bid for and sell those certificates like other commodities on a futures market such as oil or pork.

“I’ve been involved in sports one way or another for 20 years, and I’ve never seen an idea as novel as this,” said Peter Roisman, Ticket Reserve president and former sports attorney and agent. “In this business, there is a lot of following and not a lot of breakthrough ideas. This, I believe, is a breakthrough. There has never been a forward market for live events until now.”

The company made its public debut earlier this year with Super Bowl XXXVIII in Houston, selling futures to 40 tickets to the big game. More than 800 people made bids, with lucky fans of New England and Carolina winning out. Since New England was highly favored to make the Super Bowl for weeks, early purchasers of Patriots certificates watched the value soar from $200 to $800, with some opting to cash in for a healthy profit instead of going to the game.

The total number of tickets available for the NCAA basketball semifinals and title game — 48 for each day — is similarly small, raising immediate questions about the potential revenue stream for the Ticket Reserve. But the company reaps money in several ways. First, it keeps the funds from every initial event certificate purchase. Second, it charges a 10 percent commission on every subsequent certificate trade like any securities broker.

The Ticket Reserve, looking to turn an initial profit by mid-2005, is also working on expanding its pool of available tickets, as well as bringing in corporate advertisements. That mandates the future cooperation of pro leagues, teams, events and sponsors, to which the Ticket Reserve is offering revenue sharing in exchange for tickets and promotional support.

“You hear all the time teams and leagues talking about their problems generating more revenue. This is one clear way for them to do that,” Roisman said.

Since bidding promises to be frenetic for favored teams, the Ticket Reserve also runs the risk of slipping away from its serve-the-average-Joe mantra on which it was founded. Roisman, however, disagrees.

“The diehards are going to get their certificates early and hold them,” Roisman said. “With the Super Bowl market, 62 percent held and 38 percent sold. For those who bought early and held, a certificate that started in price at $200 allowed them to purchase a Super Bowl ticket for $500 face value. So that’s $700 for a $500 ticket. I promise you the normal secondary market is much, much worse than that. And nearly everyone who actually went to Houston through us was a regular person, a real fan, and thrilled to be there.

“Fans are fans and they want access, and what we’re all about is providing more access,” he said.

The Ticket Reserve, now employing former NFL coach Mike Ditka as a spokesman, is now plotting a long-term business plan to include global sporting events like the World Cup and Wimbledon, plus perhaps even high-profile concerts and shows.

“Wherever there is a high-demand, very-low-supply event, that’s where we want to be,” Roisman said. “There’s no reason not to put a forward market in that situation.”

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